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HOA insurance: 5 questions condo owners should ask

Living in a condo building is about sharing — whether it involves using the elevators, garage, or fitness center. Sticking with this theme, learn more about the insurance provided by your homeowners association.

What is a homeowners association?

When you buy your condo, you join a homeowners association (HOA), a group formed by the property owners in a shared-space environment. Together, the members of the HOA set rules and handle the upkeep of common areas and the building itself.

HOA insurance

Your HOA has insurance that covers many risks in the general building. Typically, this condo master policy is maintained through HOA fees that all of the condo owners pay. Everyone pays a little to insure a lot collectively.

5 HOA insurance questions

Condo owners should also have their own coverage to account for personal property and risks the HOA policy doesn't include. But before you set up your individual protection, it helps to know exactly what you're getting from your homeowners association.

1. What kind of condo master policy does the HOA have?

Probably the most common is studs-out coverage, which essentially includes everything outside of your unit. The HOA insurance would step in for incidents regarding the basic building — like if hail damaged the roof, the elevators broke down, or a car crashed into the lobby. That would leave you in charge of everything inside your unit, including structural elements such as walls, fixtures, flooring, and cabinets.

Some homeowners associations, however, offer all-in coverage. This protects the basic building and common areas plus the structural elements and fixtures in your own unit. Having all-in coverage likely means you'd need less individual coverage against property damage, as the only property you'd be responsible for are personal belonging (clothes, records, jewelry, etc).

2. How does the HOA insurance cover liability?

Many condo master policies will help cover injuries of guests that get hurt in common areas like the pool or tennis court. But what about injuries to guests in your unit? What if you accidentally inure people or damage their property away from home?

Most condo owners need some amount of personal liability coverage, but checking the HOA policy will help give you a better idea of how much. Don't forget: if you're worried your liability insurance isn't enough to fully protect your assets, you can explore Esurance umbrella coverage.

3. Does the HOA insurance cover renovations in my unit?

The remodeling bug is known to bite homeowners without warning … and you could be next! Of course, if you renovate your condo, chances are the amount of dwelling insurance you have will have to change, too. But before you increase the limits on your own coverage, check with your condo master policy. Some HOA plans cover improvements to the unit, which could save you a bundle.

4. What are the limits of the HOA insurance (or, do you need loss assessment coverage)?

Yes, your condo master policy will cover property damage to the building and common areas, but only up to its limits. Depending on what those limits are, there's always a chance that a severe incident could exceed them. If that happens, it might fall on the condo owners to make up the difference and help repair the damage. By adding loss assessment coverage to your condo insurance, though, you can help avoid paying out of pocket.

5. Does the HOA regulate my individual condo insurance?

In some cases, your HOA's plan might stipulate how much of a certain coverage you should carry or even which company you need to buy your policy from. It's important to know these things beforehand so you can judge whether a given condo or HOA is the right fit for you and to avoid penalties down the road.

Get your condo insurance quote

Once you've studied your HOA insurance, make sure to get a copy of their plan for yourself. This helps ensure there won't be any surprises if an incident occurs in the building or your unit.

Now that you're knowledgeable about the coverage you need, you can start your free condo insurance quote today!

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